Your website's ranking on search engines is a vital element of your overall marketing campaign, and there are ways to improve your link popularity through legitimate methods. Unfortunately, the Internet is populated by bands of dishonest webmasters seeking to improve their link popularity by faking out search engines.
The good news is that search engines have figured this out, and are now on guard for "spam" pages and sites that have increased their rankings by artificial methods. When a search engines tracks down such a site, that site is demoted in ranking or completely removed from the search engine's index.
The bad news is that some high quality, completely above-board sites are being mistaken for these web page criminals. Your page may be in danger of being caught up in the "spam" net and tossed from a search engine's index, even though you have done nothing to deserve such harsh treatment.

But there are things you can do - and things you should be sure NOT to do - which will prevent this kind of misperception.
Link popularity is mostly based on the quality of sites you are linked to. Google pioneered this criteria for assigning website ranking, and virtually all search engines on the Internet now use it. There are legitimate ways to go about increasing your link popularity, but at the same time, you must be scrupulously careful about which sites you choose to link to. Google frequently imposes penalties on sites that have linked to other sites solely for the purpose of artificially boosting their link popularity.

They have actually labeled these links "bad neighborhoods."
You can raise a toast to the fact that you cannot be penalized when a bad neighborhood links to your site; penalty happens only when you are the one sending out the link to a bad neighborhood. But you must check, and double-check, all the links that are active on your links page to make sure you haven't linked to a bad neighborhood.
The first thing to check out is whether or not the pages you have linked to have been penalized. The most direct way to do this is to download the Google toolbar at http://toolbar.google.com. You will then see that most pages are given a "Pagerank" which is represented by a sliding green scale on the Google toolbar.
Do not link to any site that shows no green at all on the scale. This is especially important when the scale is completely gray.

It is more than likely that these pages have been penalized. If you are linked to these pages, you may catch their penalty, and like the flu, it may be difficult to recover from the infection.
There is no need to be afraid of linking to sites whose scale shows only a tiny sliver of green on their scale. These sites have not been penalized, and their links may grow in value and popularity. However, do make sure that you closely monitor these kind of links to ascertain that at some point they do not sustain a penalty once you have linked up to them from your links page.
Another evil trick that illicit webmasters use to artificially boost their link popularity is the use of hidden text. Search engines usually use the words on web pages as a factor in forming their rankings, which means that if the text on your page contains your keywords, you have more of an opportunity to increase your search engine ranking than a page that does not contain text inclusive of keywords.
Some webmasters have gotten around this formula by hiding their keywords in such a way so that they are invisible to any visitors to their site. For example, they have used the keywords but made them the same color as the background color of the page, such as a plethora of white keywords on a white background. You cannot see these words with the human eye - but the eye of search engine spider can spot them easily! A spider is the program search engines use to index web pages, and when it sees these invisible words, it goes back and boosts that page's link ranking.

Webmasters may be brilliant and sometimes devious, but search engines have figured these tricks out. As soon as a search engine perceive the use of hidden text - splat! the page is penalized.
The downside of this is that sometimes the spider is a bit overzealous and will penalize a page by mistake. For example, if the background color of your page is gray, and you have placed gray text inside a black box, the spider will only take note of the gray text and assume you are employing hidden text. To avoid any risk of false penalty, simply direct your webmaster not to assign the same color to text as the background color of the page - ever!
Another potential problem that can result in a penalty is called "keyword stuffing." It is important to have your keywords appear in the text on your page, but sometimes you can go a little overboard in your enthusiasm to please those spiders. A search engine uses what is called "Keyphrase Density" to determine if a site is trying to artificially boost their ranking. This is the ratio of keywords to the rest of the words on the page. Search engines assign a limit to the number of times you can use a keyword before it decides you have overdone it and penalizes your site.
This ratio is quite high, so it is difficult to surpass without sounding as if you are stuttering - unless your keyword is part of your company name.

If this is the case, it is easy for keyword density to soar. So, if your keyword is "renters insurance," be sure you don't use this phrase in every sentence. Carefully edit the text on your site so that the copy flows naturally and the keyword is not repeated incessantly. A good rule of thumb is your keyword should never appear in more than half the sentences on the page.
The final potential risk factor is known as "cloaking." To those of you who are diligent Trekkies, this concept should be easy to understand. For the rest of you?cloaking is when the server directs a visitor to one page and a search engine spider to a different page. The page the spider sees is "cloaked" because it is invisible to regular traffic, and deliberately set-up to raise the site's search engine ranking. A cloaked page tries to feed the spider everything it needs to rocket that page's ranking to the top of the list.